Why Thailand's May economic data could show some silver lining

Time to move on frmo the April disappoinment.

According to DBS, if the April trade data was disappointing, the upcoming May trade data may prove to be slightly more encouraging.

Here's more from DBS:

Not that we expect a strong showing in export growth, for the support from external demand still appears to be somewhat soft.

Export growth is likely to remain in the negative territory, although on nominal terms, we expect total exports near the USD 20bn mark. Note that the last time exports reached USD 20bn in a month was in Aug13.

A couple of other data at the end of week is quite important for the outlook on export growth going forward. Capacity utilization spiked significantly in March before crashing down again in April. A more sustained improvement in capacity utilization tends to show, among others, a stronger pick-up in external demand.

The industrial production data for May would also provide some telling signs of demand in manufacturing going forward.

At the current rate, total export growth for the year is likely to be around 2-3% YoY. No growth is expected for imports. Domestic demand has remained weak and we expect another double digit contraction in imports in May.

Imports have fallen quite significantly in the year-to-date, currently trending at around 10% lower than 2013. The trade balance may record a surplus of about USD 1bn in May, compared to surprising USD 1.5bn deficit recorded in April.

For the full year, we expect the current account to record a surplus (circa USD 2bn or 0.5% of GDP), despite tepid export growth.

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